No details provided to banks on how subsided interest rates will work, association says

Local banks have not been given details on how subsidised interest rates through a government scheme for hard hit businesses will work, the Malta Bankers’ Association have said. 

In a statement on Saturday, the association said, “specific details, terms and modality of the announced scheme” have not yet been forwarded to its members. 

The scheme looks to offer businesses and self-employed workers a subsidy on the 2.5% interest rate charge by banks for the first two-years of their loan, intended to ease the impact of COVID-19. 

The association said that banks are receiving numerous queries on how the scheme will play out, stating that once the information necessary is communicated, the association would be providing its members with the necessary updates. 

Despite the lack of information provided, the association welcomed the scheme’s announcement, stating its readiness to collaborate in implementing the measure. 

The scheme will cost the government around €20 million a year in collaboration with the Malta Development Bank. 

The scheme is being offered by Bank of Valletta, HSBC, APS, BNF Bank, MeDirect, Lombard Bank, Izola Bank and FCM Bank.